| GEO Business|
Asian stocks slump on eurozone, China jitters
| Updated at: 1113 PST, Tuesday, November 23, 2010|
HONG KONG: Asian stocks slumped on Tuesday due to tremors from the eurozone debt crisis and worries about further measures by China to cool its economy.
While Tokyo was closed for a public holiday, Shanghai's Composite Index fell 2.66 percent in the morning, Hong Kong's Hang Seng Index lost 1.61 percent, Sydney's S&P/ASX 200 index was down 0.87 percent and Seoul's Kospi was off 0.99 percent.
Asian stocks partly responded to falls on European markets and on Wall Street. In the United States, a vast insider-trading probe was compounding the ongoing worries about Europe's debt problems.
"The market is just fatigued," RBS head of sales Justin Gallagher told Dow Jones Newswires in Sydney. "Europe has been something of a time bomb for a while now and there's still this undercurrent of structural issues that haven't been dealt with," he said, referring to worries that some eurozone countries may still have unresolved debt problems despite a bailout agreed for Ireland.
Traders also voiced worries about China. Chinese authorities raised banks' reserve requirement ratios last week to restrain credit in response to surging inflation, but further measures to cool the economy are still expected.
"The latest reserve requirement ratio hike isn't enough to curb inflation," said Zhuang Qianhua at Huatai Securities. Responding to the eurozone's woes, the dollar rose against the European unit in Asian trade, as well as against the yen. The euro sank to 1.3575 US dollars from 1.3622 dollars late Monday in New York. It traded at 113.10 yen as compared with 114.82 yen on Monday. The greenback bought 83.35 yen, compared with 83.29 yen. Wall Street presented a mixed picture. The blue-chip Dow Jones Industrial Average closed down 0.22 percent, while the broader S&P 500 index fell 0.16 percent.
However the tech-rich Nasdaq was up 0.55 percent, boosted by an 8.9 percent rise in shares of subscription movie service Netflix. In other developments, New Zealand Oil and Gas, which holds almost a one-third stake in the Pike River coal mine where 29 men are missing after an explosion, saw its shares plummet around 30 percent when a trading suspension was lifted on Tuesday.
Oil prices were a mixed bag: New York's main contract, light sweet crude for December delivery, rose 10 cents to 81.84 dollars, while Brent North Sea crude for January fell three cents to 83.93 dollars.
Gold opened at 1,363.50-1,364.50 US dollars an ounce in Hong Kong, up from Monday's close of 1,361.00-1,362.00 dollars.